A further 6bps fall in NZ 10-year bond yields has taken them back to last year’s all-time lows at 3.22%.

This Friday the DMO will auction $120m of NZGBs, though probably insufficient to completely ease the current tight NZGB supply-demand dynamics.

Overnight, despite a fairly soggy Eurozone composite PMI release German 10-year bond yields rebounded from their lows to close at 1.26%.

Peripheral Eurozone spreads continue to narrow. Spanish-German 10-year spreads (3.02%) are now at their tightest level since January last year, before they spiked above 6.0%.

US 10-year yields traded as low as 1.64% after the European PMI release before launching a return to 1.70%.

Around 5.00am this morning yields gapped again to 1.64% after the Associated Press had its Twitter account hacked, announcing an explosion at the White House. This false information was quickly denied and yields returned to trade at 1.70%.

It will be a busy Trans-Tasman today. The RBNZ will announce rates at 9.00 (NZT) and AU CPI data will be released at 1.30pm (NZT).

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